tv [untitled] June 30, 2014 7:00pm-7:31pm PDT
please get those to us >> we'll be happy to. >> i know we've been and, of course, this is a question for the colleague there. >> some of the changes that have been made to the phase one project physical changes and changes to the budget due to the costs increases the removal of the park from phase one and then or the issue of the park and the public design amenities can you talk about that. >> yeah. the park is definitely stale part of ptosis phase one and ken rich said we're working with the mayor's office to get the park opened cellular a they and that's scheduled late 2017.
>> how is the park being paid for . >> we're going to work with the mayor's office. >> i've heard $29 million gap is that the - >> the total amount direct and indirect. >> the total amount it $37 million. >> so through the grapevine you'll meningitis the $37 million for the parks will or may come out of the mel ruse a that's another $37 million less for the downtown extension is that fair. >> you said 16 is an equivalent amount. >> so 618 minus 37. >> you see sort of the pattern of my questions i'm concerned
with since this project is it will be out of the ground zoo soon but there's plenty of opportunity for cost changes. i'm going to predict every time the cost change or some increased costs that's we've got this pot of money that would have been $818 million to downtown and now down to 6 hundred plus million dollars now the shortfall from the park comes out of the mel ruse you down to 581 i see the number diminishing and diminishing further you know urge to get to the next page and i know you'll get there i know you're as passionate about the dp x i want
to make sure we're not shooting ourselves in the foot by viewing the mel ruse you funds instead of trying to gaud them, you know, zealously for use in the d t x, x but use them to make up shortfalls i'm concerned it might be used to pay for the parks. it's the easy way out to take it out of the mel ruse >> i agree with you supervisor wiener we're surfacing a robust market we've got $6 million for the building of the transit center. it depletes the number of contractors that are able to bid that's if you have less
contractors bidding it becomes harder. we've come up with a thirty miles mitigation plan cost reductions but i agree with we need to deal with the construction confidence increases >> the costs so in addition to the park issue we have to go into the downtown extension funds to make up the quest some of those costs are toubl to me a to make this a masterpiece so talk about the measures. >> and what they total in costs. >> the proposal the plan we presented to the board at muni it talked about the phase two.
>> is that - that's going to be paid out of phase two. >> it's deleting the costs. >> it will be paid for out of the downtown costs and if we need it this is electrical work that is above but we during phase two we'll very visit it and see if it's necessary or not the park is $5 million so we've looked at the need for phase one and reduced our scope for the information technology and the irrigation plan we know what we need as he mention we've deferred some of the equipment and the xhaerments from phase one to two we want to make that simpler. we also removed the glass
concrete covering this is g f r.c. to reduce concrete make it nicer we'll paint the concrete and take other measures to achieve some results. we've also number two, of using stainless steel we're going to use the galvanizing steel. we are reducing our ceilings designed to make p that more off the shelf and designer made. we're redesigning some of the barriers on the bus tech it has a steel barrier and we're going to replace that by a steel barrier so a lot of the cost reductions the public will be able to use the park and this
transit center >> it won't look as good. >> well, it will be very nice. >> in terms of those cost-cutting measures that will impact sort of the aesthetics and experience that people not the transit experience but the experience of people insides the center using the center what's the total costs in terms of the downgrading of those aesthetic amenities. >> presidential approximately 10 to $15 million of the numbers it's in that range if you take the electrical scope. >> so we'll get that list so see the phase two and some of the amenities and the total of the amenity that have been downgraded to save money?
>> we like to call it valley jerry. >> if i call it either one. >> supervisor kim. >> thank you. just wanted to talk about since we're talking about phase the one budget the largest increase was not the construction but the r v and the security plan. i know it's a point i've brought up over and over to the joint powers authority board i know we've it look at outing how to take a to the a the increases largely match the dollar for dollar that's a place we should continue to examine the board
has questions we had one consultant look at the plan and it's a difficult position for us we don't want to sacrifice security, of course, a very dense area of downtown it didn't help the department of homelands security for what that means it's important to look at that. i'll add that i'm happy to see we'll have an altitude oversight that manages prongs in the city what's particularly telling the projects starting around the savings time same time as the general hospital when the cost of were lower. what supported the general hospital staying on time and under budget was the fact their bids are not or went out earlier and our bids have been detailed we can't cry over split milk but
it's best we have as many have our best thinkers in the room in terms of how we can reduce some the costs so there's a major concern we know we'll get phase one done but not at the expense of the terminal d t x. >> sir. >> certainly we agree, of course, on the importance of phase two as we move forward with ptosis phase two we have not creating a situation we can't move forward with that phase but some of the things in the pipeline we'll have to bid toward a future bridge tolls
some of the funds for the mel ruse. i mentioned the property tax increment that is committed to the project that flows from 2005 to 2050 and although the redevelopment agencies have been developed that's considered a enforceable obligation we're using those funds to repay one hundred and 71 million for phase one, however, the number of tax increment over the 45 year period is much more than we need to repay the $171 million so our financial advisors say depending upon when we seek out a second loan it would be in the area of 3 to $40 million. we're going to expend the period
of those that property tax increment is allocated to the project even though redevelopment has dissolved to the plan are will expire in 2050 the property taxs will be collected and we will allocate those from 2050 to 20060 that generates another million dollars and we're going to look at down the road when the d t x is implemented collecting the passenger fees a that's the as far on the tickets for high speed rail that depending on with it begins could generate several hundreds of million dollars and we've got two parcels that are valuable pieces of land in downtown san
francisco we can't sell because it's the temporary terminal and the sequa second for construction phasing so that's on the $120 million so adding that you can see a path towards having a considerable amount of phased two that funding lined up and if we look at a different method like a public-private partnership it would be possible to reduce those costs and many of the funding streams i've mentioned do flow over time so could lend themselves to an availability payment so we could use o for a milestone payment >> one final question in terms of the arrangement i guess that's in place with dpw as
supervisor kim mentioned how do you see that impacting the main project we obviously want to make sure we can't predict the cost overruns it's the nature of the transportation project but how do you see that in a completion of the project with dpws roll. >> we welcome their expertise to work with or mitigate our risks and deliver a project that is as closed to budget and possible so we welcome their avoidance. >> the director of dpw was just appointed to our board. >> thank you continue with our presentation. >> sir, did you want to complete our slide presentation. >> the last slide is what i
went through the completion of the funds. >> thank you very much. mr. rich >> that concludes my presentation. >> so mr. rich i have a question for your. how are we going to pay for the park the $37 million how >> again you don't know i don't have an answer today, i, tell you that the mayor is committed to making sure it happens the source in front of us is the mel ruse we're going to find a different source. >> i guess the question is with the mel ruse how did this decision be made whether or not the park is paid for out of the mel ruse. >> i can tell you it's an eligible cost there's nothing that needs to change in terms of
the progress i think i need from someone else but in terms of the project we need that. >> essentially supervisors it's similar to our annual progress we bring the agency to project the revenue and have the parks be part of the expenditure plan it will come before you as part of the capital budget. >> it will not that will have to be ultimately approved by the board. >> through the capital budget right. >> okay. thank you. supervisor kim >> i just had a quick question about the park again. i know one of the revenue idea that came up around private sponsoring i didn't have this
chance to ask it but if the city has examples italian-american i'm not sure this is the best question for tjpa >> i'm not aware of a public open space by i can't see i've researched it but i'm not aware. >> how about the aspects of the open space where a company sponsored a portion of a park. >> i'm not aware of it. >> we've done that for the trust for public land have gunning done that in delores park they've done that.
>> i would say as we look forward to revenue solutions i actively support the package of private-public open space itself i i know that naming is a controversial issue for public schools for example with private companies have asked for sponsorship to have their names on buildings that's a revenue solution i'm supportive but i want to know the guidelines. the city park is absolutely important i know that last july it came up with the revenue oversee for phrase one i thought it was not acceptable i think the district 6 has the least open space the smallest parks and the city park is an
important component of the transit city i i landmark to working with the city and tjpa to make sure it opens with the terminal i'm in agreement this park has to open on schedule i think the question is how are we going to pay for it on funds that would have gone to the downtown extension and in terms of private money i guess there's a question of mel ruse fund can have a private opportunity u opportunity given the mel ruses issue. okay. so the staff presentation is done if there's no other comments we'll open this up for public comment 3 and 4. any public comment over and over item three or four come forward
>> supervisors i'm jim i've been involved in this for a long time. what you have before us going back to 8 years when gavin newsom asked a city task force to figure out more ways to fund the downtown extension i amazing found a copy of the task force report they've proposed what is - what we're doing today. i've look at the public document and it indeed calls for mel ruse money to be spent for the downtown extension for infrastructure in the area and by the way, i'm on the transit area cac that's responsible for the budget and for the city park. there's nothing that clearly shows how the money that's going to be created by mel ruse can be
transferred into finishing the terminal so i think i need to carefully figure out if there's goes to take if $2 million out of the mel ruse to be investment in the terrain related aspects of the building. now because i this have 45 seconds left the discount extension and the whole network project that is a major, major project that is a city project identified in the mind of everyone it's a industry project it's currently in the legislation mostly the responsible of an obscure agency called the transbay joint powers authority i recommend you have a task force who's sole job to figure out how to get the train downtown to 6th and maybe south
and dale with all the agencies not in the hands of a small obscure agency >> any additional comes on three or four. >> seeing none, public comment is closed. colleagues do we have a motion? okay. the motion is forward items 4 three and four with positive recommendation supervisor kim >> i want to make a few comments first of all, i support this moving forward and want to thank the transbay joint powers authority for being an advocate for the funding and also working closely with the mayor's office of economic workforce development on this mel ruse plan i want to give a special thanks to tim rich in the office i know it's been two years in the making excited we're able to
pass a plan in 2012 that had unanimously support the united support around the city for a plan it's going to increase transportation i was happy to see we were able to work through the major issues whether it be the department of finance of the funding increment to build the parks that goes into this plan but also good to see that a lot of the public infrastructure will stay in place the open space is so important the placing and the city park is absolutely an important component in the plan i want to recognize tjpa and the mayor's
office for the safety improvements as it grows in intensity and workers we want to make sure that neighborhood is safe to work and bike in we're not going to have more people here the wider situations and he bulb outs and the transit lanes are going to support this neighborhood that's a model but all the funding components are an important part whether it's taxpayers' money but we'll be able to grow the mel ruse tax is going to make sure that neighborhood is successful i want to thank all the various departments that have worked on this this is a good and strong plan there's a lot of issues on the phase one and two budget the d t g are x and terminal i'm
excited about working with the city and tjpa unfortunately, we can't fix some things from the past that will make this project challenging but it's essential we all work together to make this a reality for the city. i wanted to make those comments i support this with positive recommendation >> i do it with support with some trepidation it is a transformational project for the city we call it phase one and two but you can't have one without the other so i have serious concerns that $2 million is going for phase one and phase
two i wish we weren't in this position. i'm not sold on taking innovate $37 million from the downtown extension to make up the gap for the phase two i think we need to captive truly captive any other pockets i believe there are i'm confident that there are other poekts it's hard for me a support a situation we'll take it out of the downtown project and it makes it harder i'm going to be watchful i'm concerned the remaining $139 million if the park comes out of it it will be the pot to cover other costs as we move forward the projects
have a way of shifting and no one can't guarantee there's additional cost increases we'll have a declining pot of money for the steams of money for the downtown expectation we'll see that pot of money going down and down for the phase two it's tough for me to support but with that, said we're there today and we have to get it built so i'll be supporting this >> have you had a chance to look at this letter you've received at the beginning of the hearing. >> yes. a couple of points i only thought when you handed to me. it didn't indicate it's written
by a law firm it didn't see the developers their representing to address the points in the letter the first one is the evaluation proposed by the city in the mel ruse didn't take into account the mel ruse district because they're in a special tax they have a tendency to depress the value of an office building or an asset and that's the case. if you can imagine your buying a condo and there's a special additional tax bill for that you may pay less or not notice you over e over the same amount of money there's no science we know there's a depressing effect it's hard to calculate we didn't
include that because the infrastructure and the parks and the d t x and the transbay terminal have an upward effect on the value of property so in the absence of being able to calculate one with specifics that's not in there the second large issue that's addressed is recognizing that the values that drive the rates that will be paid with a special taxes that will be paid are coming relatively high in the cycle we're obviously we don't know where we were we're not in the bottom of cycle we're close to the top the rates were set a year ago now this is a year later this is not near the top of the kindly because we've gone up we're somewhere high in the
cycle we have thirty no choice as part of the exercise we set those in this case a year ago and we established a fair formula to make a adjustment that's a index of the construction costs and sort of indicates how the economy has done from year to year yes, we acknowledge the rates are high but that's the way it works if we were at the bottom of the cycle we having would have had to 0 set it low so that's the way we do it. every building t is locked in a two percent increase in the years it's for a thirty year period. we see the train value and the rents to be u